San Diego Approves Suite of Housing Incentives
The San Diego City Council adopted a wide-ranging set of measures aimed at tackling the city's housing crisis with a 7-1 vote following a heated three-hour public hearing. Included in the package is a controversial developer incentive that critics fear could exacerbate segregation by limiting low-income residents' access to affluent areas. Council members remain optimistic about the incentive's benefits, having made amendments to address concerns. The package emphasizes various incentives, such as building single-room-occupancy hotels, converting commercial sites to housing and accommodating housing for college students. Additionally, it introduces protective measures for displaced low-income residents and aims to stimulate home construction to meet mandated goals. Some community leaders criticize elements of the plan, specifically the allowance for developers to build low-income and market-rate housing at different locations under the Complete Communities program, which was previously required to be on the same site. Initial plans to enact SB 10 density provisions were eliminated from the plan in the face of stakeholder opposition. The city has faced challenges in meeting housing targets, with concerns raised about potential repercussions, including segregation and unknown consequences. (See related CP&DR coverage.)

State Releases Environmental Report for Delta Water Tunnel
The Department of Water Resources released the final environmental impact report for a long-discussed 45-mile water tunnel beneath the Sacramento-San Joaquin River Delta. Championed by Gov. Gavin Newsom, the Delta Conveyance Project aims to modernize California's water system by transferring water from the Sacramento River to southern areas via large pumps, an initiative Newsom deems vital to combat climate change-induced droughts and enhance water infrastructure resilience. However, critics, including environmentalists, question the $16 billion project's impact on the delta's delicate ecosystem and endangered fish species, advocating for alternative water management solutions such as recycling and stormwater capture. Initially envisioned as a two-tunnel project under former Governor Jerry Brown, Newsom now supports a single-tunnel version of the initiative, with estimated construction costs at $16 billion. Proponents highlight the tunnel's potential to capture substantial water during heavy storms, though opponents express concerns about the detrimental effects on native fish populations. Despite differing viewpoints, some water districts and business groups support the project as essential in navigating California's changing climate, emphasizing its role in securing water supplies during challenging conditions.

State Certifies San Francisco Housing Element; City Avoids Penalties
The Department of Housing and Community Development certified San Francisco's housing streamlining legislation, preventing potential penalties like the loss of affordable housing funding and local control over development approvals. The California Department of Housing and Community Development confirmed the city's ordinance aligns with state law and emphasized the need for San Francisco to fulfill outstanding required actions. Following missed deadlines, the city finally passed the legislation, originally proposed by Mayor London Breed, after introducing amendments safeguarding rent-controlled units, historic buildings and single-family homes predating 1923. This move is part of the state's objective to push San Francisco to build 82,000 units over eight years, with 46,000 designated as affordable for low- and moderate-income families, streamlining processes and reducing Planning Commission hearings for many projects. The amended reform package passed by a 9-2 vote.

Lake Tahoe Development Plan Faces Lawsuit
A group of residents in the Lake Tahoe basin are suing to contest recent development plan changes in court, aiming to impede alterations that seek to promote affordable housing, hospitality and dining on the lake’s West Shore. The legal action, lodged in Placer County Superior Court, intents to safeguard Lake Tahoe, according to the coalition filing the suit. Late in October, Placer County supervisors sanctioned pivotal revisions to the overarching Tahoe development plan, influencing building guidelines across the basin from South Lake Tahoe's periphery to Kings Beach, overseen jointly by the Tahoe Regional Planning Agency. Despite county claims that the adjustments would bolster lodging, mixed-use redevelopment and workforce housing, skeptics among Tahoe residents fear exacerbation of existing problems like traffic, crowding and pollution. The lawsuit challenges the approval process under the California Environmental Quality Act, demanding a fresh environmental impact report considering the lake's infrastructure challenges.

Terner Center Recommends Reforms to State's "Prohousing" Program
UC Berkeley's Terner Center for Housing Innovation released new analysis of the state's Prohousing Designation Program (PDP) overseen by the California Department of Housing and Community Development (HCD), concluding the program can improve by consolidating "prohousing" criteria, enhancing transparency of the criteria and implementing data-driven analysis of policy reforms' impact on housing production. The PDP, started in 2021, assesses local areas' housing policies, considering zoning, timelines for housing construction, cost reduction strategies and potential extra points for equity and sustainability efforts. Jurisdictions achieving this prohousing designation gain advantages in applying for grants and access to special funding opportunities. The analysis recommends several methods to increase the effectiveness of the program, including simplifying criteria, reducing the complexity of the application process and solid metrics to study the impact of the PDP. The Turner Center suggests to adapt elements of California's PDP for the federal Pathways to Removing Obstacles to Housing (PRO Housing) program run by HUD, which emphasizes federal support for expanding housing availability. Moreover, the Turner Center adds linking additional funding sources, such as infrastructure or transportation funds, to the PDP could further encourage jurisdictions to actively address housing challenges in a meaningful way. (See related CP&DR coverage.)

Los Angeles County Plans to Source 80% of Water Locally by 2040
Los Angeles County's newly adopted water plan aims to increase local water sourcing substantially over the next 20 years due to climate change impacts and escalating costs associated with external water supplies. This strategic plan outlines a shift towards sourcing 80% of water locally by 2045, focusing on stormwater capture, recycling and conservation to increase water supply by 580,000 acre-feet annually. The initiative underscores the need for water conservation and beneficial reuse, diverting stormwater away from coastal pollution. Started in 2019, the plan gained traction emphasizing collaboration among over 200 independent water agencies in the county to develop regional water strategies and shared goals. The plan's objectives encompass enhancing water supply reliability, groundwater collection, managing wildfire impacts and supporting failing water systems in low-income communities by offering resources for improvement. Environmental groups commend the county's commitment, lauding the plan's responsiveness to stakeholder concerns and its potential for leveraging state and federal funding opportunities while prioritizing equitable access to clean water for all residents.

CP&DR Legal Coverage: U.S. Supreme Court May Forbid Exactions
For half a century, planners in California and across the country have relied on a wide variety of “exactions” – impact fees, environmental “mitigations,” inclusionary housing ordinances, and other items developers are required to fork over in order to get an entitlement. But now the U.S. Supreme Court appears likely to box in entitling agencies on entitlements more strictly than ever before. The only question is how far the justices will go. This is coming to the fore because the Supreme Court decided to accept a little-noticed California appellate court ruling, Sheetz v. County of El Dorado, which was decided last year. The court upheld El Dorado County’s imposition of a $23,000 fee on as part of the approval for an 1,800-square foot manufactured home. It’s a foregone conclusion that the court will strike down the California rule about broad policy not being covered by Nollan/Dolan. At the very least, that will be a boon to the consulting industry that does nexus studies. But how far beyond that will they go?

Quick Hits & Updates

Shasta County filed a lawsuit against the California Energy Commission (CEC) regarding the Fountain Wind Project, alleging lack of CEC authority to approve it and demanding cessation of any related actions due to jurisdictional issues. The county, partnering with the Pit River Tribe, contends that the wind energy project poses risks to the environment, cultural resources and community well-being. Meanwhile, ConnectGen, the project developer, argues for the project's necessity in meeting California's carbon reduction goals and highlights its economic benefits, including local job creation and tax revenues.

A proposed gondola linking downtown Los Angeles with Dodger Stadium, initially priced at $125 million in 2018, now projects a potential cost of up to $500 million according to an environmental impact report, facing regulatory hurdles and unresolved concerns about funding and future development. Despite the report's focus on the gondola as a transit project, community worries persist regarding potential construction, while specifics about financing sources and guarantees against taxpayer funds remain undisclosed.

A recent report reveals that San Diego is falling significantly behind on its housing construction targets, needing to triple its efforts, particularly in constructing low and moderate-income housing units, concentrating more than half of new homes in just three neighborhoods, sparking debates on the effectiveness of current incentives, and prompting calls for additional measures and more effective strategies to meet the city's urgent housing needs.

Despite improvements from the pandemic peak, over 1 million California renters are behind on rent, with almost 150,000 fearing eviction in the next two months, largely impacting economically vulnerable renters and low-income households, exacerbating the already expensive rental market across the state, particularly in areas like San Francisco and Los Angeles, leading to increased housing stress and eviction concerns, signaling a crisis in California's housing market.

A redevelopment plan for Piers 30-32 and Seawall Lot 330 in San Francisco, which includes housing, retail and a bay swimming pool, faces a $125 million financing gap due to increased infrastructure costs and compliance modifications. Developers are negotiating with the Port, exploring tax districts, and using office space to cover necessary construction expenses amid challenges affecting other waterfront projects in San Francisco due to rising construction costs and market factors.

The San Diego Trolley is the highest-ridership light-rail line in the US since the pandemic, with over 34 million trips in 2022, surpassing other major systems. While its ridership dipped during the pandemic, it retained a higher level compared to other systems due to factors like the Mid-Coast Trolley extension and efforts to maintain service levels. As transit ridership picks up nationwide, San Diego's Trolley continues to maintain its top-ranking position in 2023, although other cities are experiencing faster recovery rates.

California ranks as the top state for transportation policies and spending priorities according to a new scorecard released by the Natural Resources Defense Council (NRDC). The report highlights California's leadership in sustainable transportation investments, emphasizing initiatives like vehicle charging stations, public transportation and bicycle infrastructure while addressing climate change and equity concerns.

Caltrans omitted a significant industrial park from its environmental review connected to a freeway expansion in Fresno, despite prior knowledge of its existence. This omission has raised legal and ethical concerns regarding the project's impact on public health and environmental effects, casting doubt on Caltrans' decision-making process and transparency.

Los Angeles city is set to spend around $40 million to rescue the failed Skid Row Housing Trust, expecting further expenses by mid-2024, stemming from the trust's financial collapse earlier this year. The city aims to stabilize the properties and transfer them to new nonprofit housing providers to prevent a humanitarian crisis, despite frustrations and financial challenges during the rescue efforts.

The San Jose City Council unanimously adopted stronger protections for 13 mobile home parks, mandating developers to seek council approval and a general plan amendment for potential redevelopment, aiming to preserve affordable housing spaces. This decision reflects the council's commitment to maintain these communities amid concerns over their conversion into high-density housing, providing reassurance to residents, particularly seniors with lower incomes, who have fought to safeguard their neighborhoods.